Tenn. Code Ann. § 45-2-704 (2026)

• (a)
  • (1) Whenever any deposit is made in any bank by any person in trust for another, and no other or further notice of the existence and terms of a legal and valid trust is given in writing to the bank, the bank is entitled to deem the following with respect to the deposit, that:
    • (A) The person designated as trustee is the owner of the deposit account;
    • (B) The owner retains the right during the owner's lifetime to withdraw, assign or pledge the balance of the deposit account, in whole or in part, as though no survivor beneficiary had been named, and to delete or change a survivor beneficiary; and
    • (C) The interest of a person designated as beneficiary shall not vest until the death of the owner, or in the case of joint owners, until the death of the last surviving owner, and the interest shall be subject to any lien, assignment, pledge, right of offset or other claim that the bank could have asserted against the owner.
  • (2) No change in the designation of the survivor beneficiary is valid unless executed on a form and in a manner prescribed by the bank.
  • (3) The following terms shall be deemed to apply to the account, unless the owner notifies the bank otherwise:
    • (A) The interest of the beneficiary in the account vests, only if the beneficiary survives the last surviving owner;
    • (B) Multiple beneficiaries surviving the last surviving owner shall be entitled to equal shares of the account; and
    • (C) If no beneficiary survives, the account shall remain in the estate of the last surviving owner.
  • (4) When a deposit account is so established, the account, or any part of the account, or any interest in the account, may be paid to any owner during the owner's lifetime. On the death of the last surviving owner, the deposit account, or any part of the account, or interest in the account, unless otherwise provided by notice to the bank and its acknowledgement, may be paid either:
    • (A) To each designated beneficiary in equal shares; or
    • (B) To all beneficiaries as tenants in common, the duty of any apportionment among beneficiaries devolving to the beneficiary or beneficiaries receiving payment; and the receipt or acquittance of the person or persons so paid shall be a sufficient release and discharge of the bank from liability to any person for payment.
  • (5) In the event that any beneficiary, or any other person, contests any payment to a beneficiary, the bank may interplead the funds into a general sessions court, circuit court, or probate court with appropriate jurisdiction. A bank initiating, joining in, joined into, or defending in any manner, an interpleader action shall be entitled to recover from the funds tendered or offered to be tendered the costs of the action, including reasonable attorneys' fees.
  • (6) In determining persons to be paid, or shares to be paid, if a bank chooses to pay more than one (1) beneficiary, a bank is entitled to presume the survival of an owner, or beneficiary, and no payment need be made to a beneficiary until the person's entitlement by right of survivorship is confirmed by official death certificate or other proof acceptable to the bank.

• (b)
  • (1) Any person, or persons jointly as tenants with right of survivorship, owning a deposit account may enter into a written contract with any bank whereby the balance of the deposit account may be made payable on the death of the last surviving owner to another person or persons, notwithstanding any provisions of law to the contrary.
  • (2) In creating the account, "payable-on-death" or "payable on the death of" may be abbreviated to "P.O.D."
  • (3) The contract shall be deemed to contain a right on the part of an owner during the owner's lifetime both to withdraw, assign or pledge the balance of the deposit account, in whole or in part, as though no death payee had been named, and to delete or change a designated death payee.
  • (4) The interest of a death payee shall be deemed not to vest until the death of the owner, or, in the case of joint owners until the death of the last surviving owner, and the interest shall be subject to any lien, assignment, pledge, right of offset or other claim that the bank could have asserted against the owner.
  • (5) The following terms shall apply to the account, unless the contract provides otherwise:
    • (A) The interest of a death payee in the account vests only if the payee survives the last surviving owner;
    • (B) Multiple death payees surviving the last surviving owner shall be entitled to equal shares of the account; and
    • (C) If no death payees survives, the account shall remain in the estate of the last surviving owner.
  • (6) No change in the designation of a death payee shall be valid unless executed on a form and in a manner prescribed by the bank and authorized by all account owners living at the time of the change.
  • (7)
    • (A) When a deposit account is so established, the account, or any part of the account or any interest in the account, may be paid to any owner during the owner's lifetime. On the death of the last surviving owner, the deposit account, or any part of the account or any interest in the account, unless otherwise provided in the contract, may be paid either:
      • (i) To each designated death payee in equal shares; or
      • (ii) To all death payees as tenants in common, the duty of any apportionment among death payees devolving to the death payee or payees receiving payment;
    • (B) The receipt or acquittance of the person or persons paid shall be a sufficient release and discharge of the bank from liability to any person for payment.
  • (8) In the event that any death payee or any other person contests any payment to a death payee, the bank may interplead the funds into a general sessions court, circuit court, or probate court with appropriate jurisdiction. A bank initiating an interpleader action shall be entitled to recover from the funds tendered the costs of the action, including reasonable attorneys' fees.
  • (9) In determining persons to be paid, or shares to be paid, if a bank contracts or chooses to pay more than one (1) death payee, a bank is entitled to presume the survival of an owner, or death payee, and no payment need be made to a death payee until the person's entitlement by right of survivorship is confirmed by official death certificate or other proof acceptable to the bank.

• (c) No bank so paying the survivor or death payee shall be liable for any estate, inheritance or succession taxes due this state.

• (d)
  • (1) Notwithstanding any provision of this section or any other law to the contrary, nothing contained within this section shall be construed to prevent a living trust from being designated as a beneficiary of a payable-on-death account.
  • (2) Prior to accepting the designation of a living trust as beneficiary, a bank may require the account owner to deliver a copy of:
    • (A) Certificate or affidavit of trust:
      • (i) In the form and containing the information required by the bank;
      • (ii) Signed by the grantor, trustee or both; and
      • (iii) Notarized; or
    • (B) Other documents establishing the trust as may be acceptable to the bank.
  • (3) A bank may rely on the continuance of the trust and the information provided in the certificate, affidavit or other documentation, until the bank receives actual notice of any amendment, revocation or change, including, but not limited to, appointment of a co-trustee or successor trustee, or removal of a trustee. Actual notice shall not be effective until delivery of documentation acceptable to the bank to support the amendment, revocation or change.

Amended by 2017 Tenn. Acts, ch. 264,s 5, eff. 7/1/2017.

Acts 1969, ch. 36, § 1 (3.205); T.C.A., § 45-408; Acts 1983, ch. 110, §§ 2, 3; 1991, ch. 51, § 1; 1993, ch. 39, §§ 1-5, 7-9; 1994, ch. 655, § 1.